Preview: NCPERS 2025 Public Retirement Systems Study
Every year since 2011, NCPERS has conducted our Public Retirement Systems Study to gather the latest data on funds' fiscal, operational, and business practices. We are pleased to announce that the soon-to-be released 2025 Public Retirement Systems Study received a record 201 responses, helping us better understand the public pension landscape and track industry trends.
Every year since 2011, NCPERS has conducted our Public Retirement Systems Study to gather the latest data on funds' fiscal, operational, and business practices. We are pleased to announce that the soon-to-be released 2025 Public Retirement Systems Study received a record 201 responses, helping us better understand the public pension landscape and track industry trends.
If you are interested in learning about the latest study's most notable findings, please register to attend our webinar NCPERS Annual Public Retirement Systems Study: Key Trends and Insights on February 25. Attendees will gain insights into the current state of public plan practices, asset allocation, and fiscal performance, as well as some recent data trends and leadership priorities. Later this month, the full results of the study will be released to the public, while NCPERS members will have exclusive access to an interactive dashboard that allows them to filter data for peer-to-peer benchmarking.
Among our top-line findings, preliminary analysis indicates that funding ratios are improving, likely due to the strong equity market performance in 2024 and an upward tick in the share of plans receiving the full actuarially determined contribution. Respondents with fiscal year-end dates in the first half of 2024 reached an average funded ratio of 83.1 percent, and we anticipate similar gains across the board for systems with fiscal year-end dates in the second half of the year.
We also see evidence that equities remain the largest component of pension portfolios. Alternative investments (primarily real estate and private equity) have consistently been the second largest allocation in recent years, though for systems with fiscal year-end dates in the first half of 2024, fixed income investments are now nearly as large at 26.1 percent. NCPERS will continue to monitor this trend as plans continue to report their 2024 financial performance.
The study data continues to reinforce our contention that receiving the full actuarially determined contribution is key to better funding outcomes. Responding retirement systems that did receive their full contribution reported funded ratios an average of 20 percentage points higher than those that did not receive the full contribution. Eighty-seven percent of survey respondents indicated that they received the full actuarially determined contribution in their most recent fiscal year, continuing an upward trend from the past few years.
Overall, the data tells a story of resilience. In the span of 20 years, public sector pensions have endured two major economic crises, but by implementing best practices and appropriate plan changes, pensions have shored up funding levels and improved their sustainability. What are plan leaders planning for next? Respondents indicate that public pension priorities for 2025 include improving cyber- and fraud-prevention systems and sustaining target funding levels.
We encourage you to join us for this free webinar on February 25 at 1:00pm ET for additional detail on these and many other insights from our annual Public Retirement Systems Study. And watch for the full report – and accompanying member-only dashboard – to be released later this month. Please reach out to research@ncpers.org with any questions about this or other NCPERS research initiatives.